At the SBC Summit Lisbon last week, a significant gathering of European gambling CEOs discussed the demanding role of industry trade bodies and the complex challenges they encounter in trying to represent both small-scale and tier-one operators. These associations have taken on a crucial role in pushing back against policy-makers and ensuring regulators are accountable in the face of increasingly stringent policies across Europe.
LiveScore CEO Sam Sadi expressed a candid view to the audience, emphasizing the near-impossible task these trade bodies have in representing the entire sector due to the conflicting priorities of large and small operators. He pointed out that some tier-one entities might actually welcome new restrictions, such as advertising limitations and tax increases, seeing these as opportunities to solidify their market position. “You’ll notice the larger operators can absorb advertising restrictions or increased taxes and, in fact, might benefit as the market consolidates at the top, forcing smaller competitors out,” he suggested.
In Spain, for instance, Codere Online has repeatedly reported being affected by the 2024 rollback of advertising restrictions. The company’s CFO, Oscar Iglesias, noted in November that the reintroduction of welcome bonuses had been slightly detrimental to profit margins in Spain during Q3, as these changes brought increased costs and intensified competition from new market entrants. CEO Aviv Sher pointed out to analysts that with heightened competition, advertising prices in both digital and traditional media rise, leading to a higher cost per acquisition (CPA) and delaying ROI until these costs can be compensated.
Sadi reflected on the industry’s varied objectives, describing the trade bodies’ mission as “an almost impossible job to represent the entire industry, where so many objectives are in place.” This sentiment echoed widely among the summit’s numerous panels, where discussions were overshadowed by a generally pessimistic outlook concerning the sector’s future in Europe and beyond. Continuous uncertainty regarding new regulations and political instability in some European markets are presenting substantial challenges for industry navigation.
From the perspective of FDJ CFO & Strategy Officer Pascal Chaffard, trade bodies should aim to encompass as many operators as possible worldwide. He articulated that “the purpose of those trade associations is to define what is the goal of the whole industry, ensuring that a few bad actors don’t tarnish the reputation of the entire sector.” The industry’s credibility could be compromised by a single “black sheep,” he warned, emphasizing the importance of a unified approach.
During a panel on tax issues, European leaders deliberated on how rising tax rates are impeding growth in various markets. BoyleSports CEO Vlad Kaltenieks remarked on the broader social and economic ramifications, sharing his vision of a sustainable industry environment. He explained, “My real desire is to shape a sustainable environment, one where companies can continue to grow, innovate, and invest in technology and employment to build that ecosystem for the economy to flourish.” Tax policies, he noted, can significantly influence this trajectory. A clear and favorable tax regime could foster growth, whereas restrictive measures might breed uncertainty and disrupt market stability.
However, not all see the situation in the same light. Some industry insiders argue that increased regulation and taxes can lead to more responsible gaming practices and public trust. It’s suggested that by enforcing stricter guidelines, the industry enhances its credibility and aligns better with social expectations. This perspective posits that long-term viability depends on meeting regulatory demands and cultivating a reputation for responsibility and integrity.
The conference highlighted the necessity for trade bodies to navigate these contrasting viewpoints and objectives. While the path forward remains complex and fraught with challenges, the discussion underscored the critical need for a balanced approach that considers the varied needs of all stakeholders involved in the gambling industry.
The ongoing debate underscores the intricacies of balancing growth, regulation, and reputation in a rapidly evolving industry landscape. As the gambling sector continues to face these formidable hurdles, the role of trade bodies in mediating between diverse interests and crafting a cohesive strategy remains more crucial than ever. The future of gambling in Europe, and potentially worldwide, hinges on the ability of these organizations to bridge divides and foster a collaborative environment that supports innovation while maintaining regulatory compliance and ethical practices.
4.4/5
